Get smart with your money
Your doctor needs to know certain numbers to judge your physical health, such as your weight, your blood pressure and your cholesterol levels.
Similarly, you need to know certain numbers to monitor your own financial health. In my latest for the Associated Press, find out the 9 money numbers you need to know.
Today’s top story: Can I deduct Medicare costs on my income tax? Also in the news: Is a personal loan or home equity loan right for your reno, the high price of money shame, and steps to take before you go to a car dealership if your credit score isn’t great.
Can I Deduct Medicare Costs on My Income Tax?
If you itemize, premiums, copayments, and certain other expenses may be deductible.
Is a Personal Loan or Home Equity Loan Right for Your Reno?
The best financing depends on your financial situation, including your income, credit and how much equity you have.
The High Price of Money Shame
Simply naming the emotions you feel about financial mistakes is a step toward breaking the cycle and taking control.
If Your Credit Score Isn’t Great, Take These Steps Before You Go To A Dealership
Walk in fully prepared.
Today’s top story: How much car insurance do you really need? Also in the news: As major credit card issuers pull back amid COVID, startups stepped in, reboot your budget to prepare for reopening, and when to expect a refund for your $10,200 unemployment tax break.
How Much Car Insurance Do You Really Need?
Too little car insurance and you’re financially vulnerable. But too much, and you’ll overpay. Here’s what to know.
As Major Credit Card Issuers Pulled Back Amid COVID, Startups Stepped In
Some products that were launched or expanded in 2020 don’t bother with credit checks at all and instead look at your income and bank account. They also charge no interest.
Reboot Your Budget to Prepare for Reopening
As states ease COVID restrictions and vaccinations pick up, here’s why it’s time to take a look at your finances.
When To Expect a Refund for Your $10,200 Unemployment Tax Break
What will happen if you filed your taxes before the new stimulus.
Dear Liz: I turn 70 in July. Will I need to wait to start my Social Security benefits until 2022 to receive my full benefit, or can I start them in August 2021?
Answer: There’s no need to wait to claim your benefits once they max out at age 70. If you did apply late, you could get a maximum of six months of retroactive benefits but no more.
Dear Liz: I am writing this email on behalf of my 88-year-old dad. He wanted to ask you this question: “My wife passed away Jan. 7, 2020. In filing my 1040 income tax for 2020, am I allowed to file as a married couple or required to file as a single person?”
Answer: Your dad can use “married filing jointly” with his deceased spouse for the year of her death, assuming he didn’t remarry in that year.
If your dad claimed one or more qualifying dependents — a child, stepchild or adopted child — he might be able to file as a qualifying widower for the following two years as long as he paid more than half the cost of maintaining his home and it was the main home of the dependent or dependents. Most people your dad’s age no longer live with their kids or claim them as dependents on their tax returns. But if he did, this could preserve the larger standard deduction and other benefits of filing jointly for another couple of years.
Dear Liz: I am selling a rental property that I have owned for several years. I know I could do a 1031 exchange, which would allow me to put off the tax bill by investing in another commercial property. But I just want out. I’ll pay the capital gains tax and invest the rest of the proceeds. I am considering paying the taxes by credit card and taking on the 3% premium to get rewards points offered through the card issuer. Is this a dumb idea, or does it have some merit?
Answer: The companies that process federal tax payments have processing fees of just under 2%, not 3%. You’ll still want to make sure you get more value from your rewards than you pay in fees, and that’s not a given. If your card offers only 1.5% cash back, for example, charging your taxes doesn’t make a lot of sense. But the math changes if you can get more than 2% in rewards, or if you could use the charge to help you meet the minimum spending requirements for a new credit card with a generous sign-up bonus.
If you do charge your taxes, you’ll obviously want to pay the balance in full before incurring any interest.